How to Keep the Cost of Your E-Commerce Startup Manageable

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Although it is being reported that the number of people working from home has plateaued, home-based e-commerce startups are still on the rise. There are a number of reasons for this, but perhaps the most important reason for starting a home-based business is startup costs. Even then, those costs can amount to more than you had anticipated, so how can you keep them manageable? Here are a few tips you might want to consider.

Don’t Let Fear Be Your Guide

When it comes to investing in your own home-based e-commerce business, the one thing you need to be wary of is statistics. Make sure you understand what it is you are reading and who gathered that data! For example, it is being reported that home-based work has plateaued. Indeed, it might have leveled off, but that may not impact your startup. Don’t be afraid to sink money into a new business just because you think home-based businesses are on the decline. That is NOT what those figures are saying. Those statistics generally refer to employees and freelancers as opposed to e-commerce startups. Entrepreneurs fall into a whole other category altogether. Bear that in mind before you let fear keep you from pursuing your dream of owning and operating your own e-commerce business.

Where and How to ‘Cut’ Startup Costs

The biggest expenses you are likely to incur in the very beginning would be operational costs such as rent for premises, equipment, and employees. As noted above, so many entrepreneurs start their e-commerce businesses from home simply because that eliminates any extra rental costs and many of the utilities can be shared with household expenses. A good accountant can help you understand how to apply any expenditures toward your taxes at the end of each year. You will realize huge tax breaks if reported properly, so this can also help to keep your costs manageable. Keep accurate records for your accountant to follow.

Explore Shared and/or VPS Hosting at the Beginning

Actually, both Shared and Virtual Private Server (VPS) hosting have similarities, but they have many distinctions as well. Shared would be the cheaper of the two and although both share server space, a VPS hosting service would be more secure while offering better performance. Those are two key considerations which could be extremely important to any e-commerce site. If you want to keep costs manageable in any online endeavor, always assess risk exposure because one breach of data could literally put you out of business before you get a foothold in your market.

Finally, you might want to consider listing as many types of products which you don’t need to buy upfront as possible. Many companies offer affiliate marketing and others offer dropshipping agreements. Pay for as little inventory as possible and you’ve just saved a ton of money. What this all boils down to is taking the time to research where you can afford to cut corners and where it would be ill-advised to do so. Internet security is vital, so don’t spare expenses there if you don’t absolutely have to, but other costs can be reduced. Be prepared to make major investments but with a bit of fine tuning, they really can be manageable. This is where you start.

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Melissa Thompson

Melissa is a mother of 2, lives in Utah, and writes for a multitude of sites. She is currently the EIC of and writes about health, wellness, and business topics.